Lenoir may increase taxes

May. 28, 2014 @ 08:33 AM

The Lenoir City Council changed course Tuesday and voted 4-3 in favor of calling for a two-cent increase in the property tax rate instead of the one-cent increase they favored at a meeting last week.

The city’s capital improvements plan was based on a two-cent increase, but on May 20 a majority of the council members favored holding any increase to 1 cent. The money, just over $232,000, would be allocated for street resurfacing, infrastructure and recreational facilities.

Council members Todd Perdue, Ben Willis, David Stevens and Ike Perkins voted in favor of the 2-cent increase, to 58 cents for every $100 of value, citing rising costs for the city, infrastructure needs and a hope to avoid larger tax increases down the road.

Perkins previously had supported one a one-cent increase but said that after considering the city’s infrastructure plans and costs, he felt the larger increase is needed.

Crissy Thomas, Ron Stilwell and T.J. Rohr cited lingering economic problems for their opposition, saying the city could cut back on expenses to free funds needed for some capital projects.

Assistant City Manager Danny Gilbert had presented council members with a revised capital plan, adjusted to account for a 1-cent increase by delaying projects. The revised plan called for a 4-cent increase in fiscal 2016-17 and a 3-cent increase in fiscal 2017-18, instead of a 2-cent increase each year as was in the previous capital plan.

Stevens said he has received more comments on poor roads than anything else the past year, so he favors the increase to hold to the city's established plan for repaving.

Stilwell argued that the higher revenue would amount to "only three and a half miles" of paving. He proposed borrowing money to make a bigger impact.

Rohr said he has never been in favor of a tax increase, and the core services a city should provide don’t include many things that Lenoir does, including downtown development and providing economic incentives to new or expanding businesses. Cutting the downtown development department alone could save the city $140,000 a year, he said.

The budget will go before the council Tuesday, June 3, for a public hearing and formal adoption.